The 114-year-old New Orleans Sewerage & Water Board will
undertake a rare restructuring at the end of this year after voters
overwhelmingly agreed Saturday to remove City Council members from among its
appointed ranks.

On its surface, the successful ballot measure merely edited
the City Charter to include a description of the board's new makeup, but its
real effect was to knock down the final barrier to a bevy of so-called reforms
passed by the Legislature in June. Those changes are, in turn, part of Mayor
Mitch Landrieu's larger campaign to sell a skeptical public on a way to pay for
a complete overhaul of the city's deteriorating networks of underground pipes,
canals and pump stations.

It will be a massive undertaking: The board's staff has
tallied the bill to repair or replace every aspect of the system, including the
power and treatment plants, lift and pump stations, drainage canals and catch
basins, 1,600 miles of water pipes and 1,400 of sewer pipes, at anywhere
between $3.3 billion and $3.6 billion over the next 10 years. The board is also
in the process of selecting a new executive director after Marcia St. Martin
announced earlier this year that she would retire in December.

The S&WB, with its sordid past as a den for
contract-peddling and sweetheart deals for those with the right connections,
will see its board of directors reduced from 13 to 11 members and their terms
limited from nine years to two, consecutive four-year stints. State lawmakers
agreed to eliminate three seats reserved for sitting City Council members and
add an eighth mayoral appointment.

Because of the unusual nature of the S&WB as a
state-created agency under municipal control, the charter had to be changed to
incorporate the Legislature's new language describing the board. And it has
undergone similar changes before. From 17
members in 1899, the board ballooned to 21 in 1902 before settling at 13 in
1936.

The present board members appointed by the mayor will see
their terms expire Dec. 31.

The Legislature also formalized the process of finding new
board members when vacancies occur. The new law created a 10-member selection
committee, consisting of local college presidents and leaders of the Urban
League of New Orleans, the New Orleans Chamber of Commerce and the New Orleans
Black Chamber of Commerce, that will offer the mayor three names to choose from
for each opening.

Landrieu had couched the proposed changes as a commitment to
overhaul the S&WB in exchange for the Council's approval of 10 percent
increases in sewer and water service bills every year, leading to a doubling of
rates by 2020. The hikes, the first of which began in January, are projected to
raise $583 million that the S&WB wants to leverage to borrow even more cash
to finance its capital projects. Meanwhile the agency remains under a 1998
consent decree with the Environmental Protection Agency to stop raw sewage from
leaking into the soil through cracked pipes.

The S&WB has also agreed to file quarterly reports with
the council, install electronic meters on customers' properties that can be
monitored remotely and to improve customer service.

The ballot measure survived a last-ditch effort by several
political groups, including the Black Organization for Leadership Development
and a faction of the Orleans Parish Democratic Executive Committee, to derail
it over concerns that eliminating elected City Council members would further
buffer the appointed board from direct public accountability.

On the flip side, Landrieu didn't get everything he wanted.
The Legislature saw fit to add a few more stipulations, such as ensuring the
board has at least one appointee from each of the city's five council
districts, and that the board reflects the racial and gender makeup of New
Orleans. The mayor also lost his push to have full veto power over the
recommendations of the selection committee, which would have guaranteed only
the mayor's top choices would join the S&WB.